Total Value of Crypto Stolen From DeFi Platforms in 2023 Plummets by 63.7% Year-on-Year: Chainalysis
Blockchain analysis firm Chainalysis has reported that the total value of cryptocurrency assets stolen by cybercriminals in 2023 decreased by over 50% compared to the previous year. This decline can be largely attributed to a significant drop in hacking incidents targeting decentralized finance (DeFi) platforms.
According to Chainalysis, hackers stole only $1.1 billion from DeFi protocols in 2023, a significant decrease from the $2.5 billion stolen in 2021 and $3.1 billion stolen in 2022.
The number of DeFi hacks also experienced a 17.2% year-on-year decline, and the median loss per hack decreased by 7.4%.
“Hacks of DeFi protocols were mainly responsible for the significant increase in stolen cryptocurrency that we witnessed in 2021 and 2022, with cybercriminals stealing over $3.1 billion in DeFi hacks in 2022. However, in 2023, hackers only managed to steal $1.1 billion from DeFi protocols. This represents a 63.7% decrease in the total value stolen from DeFi platforms compared to the previous year,” states the Chainalysis report.
According to Mar Gimenez-Aguilar, a lead security architect and researcher at blockchain security firm Halborn, the reduction in the value stolen from DeFi platforms suggests that operators have made improvements in smart contract security. Additionally, hackers had fewer protocols to target due to the overall decrease in DeFi activities in 2023.
“We cannot definitively say whether the decrease in DeFi hacking can be attributed primarily to better security practices or the overall decline in DeFi activity – most likely, it is a combination of both factors,” explains the Chainalysis report.
Chainalysis warns of potential consequences if the decline in DeFi activities is indeed the primary reason for the decrease in hacking losses. If DeFi activities rise again alongside another DeFi bull market, it could lead to higher total value locked (TVL) and, consequently, a larger pool of DeFi funds for hackers to target.
Overall, the decline in value stolen from DeFi platforms in 2023 highlights both the progress made in enhancing security measures and the impact of market trends on criminal activity in the crypto space.